Vonage: 'One-Trick Pony' Going for IPO

Rich Tehrani says that this morning CNBC had a report on the expected Vonage IPO -- see more details in today's AP story. The price is expected to be set tonight at $16 to $18 per share selling 31.25 million shares.

Our colleague, long-time VoIP blogger Tom Keating, had scathing criticism for Vonage in his blog entry, "Time to dump Vonage," a few days ago. Tom has been using Vonage almost since it began, but has been extremely disappointed by the company's service lately. Tom says, "Two years ago, I talked about the 'death knell' for Vonage and other 'one trick pony' VoIP providers that rode the open Internet and didn't provide the last-mile data connection, so I did see this coming .... I wrote about the fall of Vonage to the triple play providers as something that's coming soon, so hold on while I go ring the death knell bell for Vonage."

Wow, those are striking words to read on the eve of Vonage's IPO; the phrase "one trick pony" strikes me as apt. I do think the IPO is an important development for the VoIP industry, but it's hard for me to feel excited about the long-term prospects for a company whose service is marketed as just a cheaper alternative to POTS.

Given the potential of IP communications, simply using the technology to cobble together a poor imitation of regular phone service reminds me of early television broadcasts that were just talking-head radio shows performed in front of a camera.

This quote from today's Reuters story reflects the sentiments of quite a few other comments I've seen today about the expected IPO: